Victory in fight for Yorkshire high-speed link with London

He has ditched Tory plans for a route that would only reach Leeds via Manchester and instead backed the "Y" shaped route favoured by Labour, which could cut journey times to just 80 minutes and will cost 33 billion to build.

A link from London to Birmingham will be built first – with work starting in as little as five years – with the route branching there into an East Coast line through South Yorkshire and Leeds, and a West Coast line through Manchester.

Mr Hammond has also made the significant pledge that both branches will be built at the same time – easing fears among travellers and business leaders that the Manchester branch would be built first.

Research conducted on behalf of South Yorkshire Passenger Transport Executive and its Metro counterpart in West Yorkshire suggests the Yorkshire economy will benefit from a 62bn boost to its economy as a result of a direct high-speed link to London.

The decision marks a success for this newspaper's Fast Track to Yorkshire campaign for a direct high-speed rail link to the capital.

Mr Hammond told the Yorkshire Post that although the "Y" shaped network will cost 800m more than the Tories' original plan, it will net an extra 25 billion in economic benefits.

"This is going to be a step change – it's not just a railway that goes a bit faster, it's on a par with the change that took place when journeys changed from being the speed of a horse and started being at the speed of a steam train.

"It will change the way people view the UK. When you can travel from London to Leeds in 80 minutes, I hesitate to use the term suburb but in commuting terms it would be perfectly practical for someone in Leeds to come out of their door at 7.30am and be in London for a meeting shortly after 9am. That changes the geography of the country. It changes the way people work."

The Government's plan will see the East Coast line go from Birmingham via Litchfield and through the East Midlands before passing through South Yorkshire and Leeds. It will then rejoin the existing East Coast Main Line between Leeds and York.

Work could begin in the early 2020s, and would take up to seven years to complete. New stations with platforms a quarter of a mile long would have to be built to cater for the 400m long trains, which would also be capable of running on existing routes.

The location of a station in South Yorkshire is yet to be decided, with authorities discussing possible options. In Leeds, trains would go to a new city centre station.

Mr Hammond backed the Y route – over the "S" shape in the Tory manifesto which proposed a line from London to Birmingham, Manchester and Leeds – because it allows faster journey times to Leeds, also serves South Yorkshire and will cater for an extra 40,000 trips every day. Commuters and businesses will also benefit from congestion being eased on existing lines.

A consultation will be launched early in the new year to get

public views on the route before detailed plans are worked up.

Mr Hammond will today write to High Speed Two, the company set up by Labour to develop plans for a 250mph network, to ask them to restart initial planning work for the East Coast branch of the line, having asked for it to be put on hold earlier this summer while deciding which plan to back.

The entire network is expected to cost 33 billion, the majority of which will be on the London to Birmingham leg because of the need for extensive tunnelling. The lines north of Birmingham – which could ultimately be extended to the north east and Scotland – will be much simpler to engineer.

"The expectation is that both legs will be built at once after we've built London to Birmingham, which is actually the most expensive bit of the line," said Mr Hammond. "Then we would expect to move on with Birmingham to Manchester and Birmingham to Leeds simultaneously."

Mr Hammond said the track and tunnels are likely to be funded by the Government, with private investment sought for stations and rolling stock.